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DATE=2/23/2000 TYPE=CORRESPONDENT REPORT TITLE=U-S SPY NETWORK (L) NUMBER=2-259495 BYLINE=KYLE KING DATELINE=STATE DEPARTMENT CONTENT= VOICED AT: INTRO: The United States is denying allegations by a British journalist that it has been using a world wide electronic spy system for industrial espionage in Europe. From the State Department, V-O-A's Kyle King reports. TEXT: The allegations of U-S industrial espionage have provoked calls for the European Union to set up a committee of inquiry to look into the issue. The demand emerged (Wednesday) as a European Union parliamentary committee studied a report by British Journalist Duncan Campbell. Mr. Campbell's report claims the United States, Britain and other key allies have, since the cold war, maintained a sophisticated electronic spy network called "Echelon." His report says the network of spy satellites and electronic eavesdropping equipment can monitor phone conversations, faxes, and electronic mail. The report calls the surveillance network a threat to civil liberties and alleges it has been used to collect economically sensitive information that provides a commercial advantage to U-S companies. State Department spokesman James Rubin refused to comment on the existence of the system, but he denied U-S intelligence agencies are engaged in industrial espionage. /// RUBIN ACT /// U-S intelligence agencies are not tasked to engage in industrial espionage, or obtain trade secrets for the benefit of any U-S company or companies. /// end act /// According to the British report, the Echelon program monitors world wide communications with a network of satellite and ground based listening posts. The network was established during the cold war for military surveillance. French officials have alleged that Britain has also benefited commercially from information gathered by the network, allegations British Prime Minister Tony Blair has denied. (Signed) NEB/KBK/ENE/gm/national/europe 23-Feb-2000 15:31 PM EDT (23-Feb-2000 2031 UTC) NNNN Source: Voice of America .